Wednesday, June 13, 2007

One National Hockey League governor, who requested anonymity, said he and a number of his peers are not happy with the way Balsillie is conducting his bid for the team.

They are upset that while Balsillie is telling people in Nashville the team will not move as long as an arena lease (which has an out-clause based on attendance) is in place, he is also negotiating with Hamilton.

"If you join a club or a fraternity, it is a bunch of people who have to work together in a partnership," the governor said. "Sometimes you have to give up what you want for the greater good of the league. This is not the way to come in [to the NHL].

"In my travels, I've already had people, unasked, say, 'Who is this clown?' I've had three clubs mention this to me."

...the NHL governor said the league does not want to make the mistake of allowing someone to buy a team, only to discover he is a maverick.

"You get in the club and everyone thinks you'll be okay, but you turn out to be a pain in the ass," the governor said. "This guy is showing he is a pain in the ass before he even gets in the club."

Well, this is the story du jour, one that's being picked up everywhere. The piece of news that's on the tips of tongues is that Balsillie will sign an agreement to make Hamilton the only possible destination for the Predators, a curious move given so much speculation had the Research in Motion CEO contemplating a shift to his hometown of Kitchener-Waterloo.

In truth, I don't think it matters which destination the team potentially goes to: Southern Ontario is so underserved for NHL hockey that, if you bring a team, people will come. More than 20 per cent of the Buffalo Sabres' season-ticket base is Canadian-based, and Hamilton is a heckuva lot closer to most of this country's high-rollers than western New York.

Still, that's just one of the interesting tidbits in Shoalts's piece, and the sections I've quoted above deserve some attention. It's been rumoured that the NHL's board of governors were and/or would be upset by Balsillie's actions to that point, something the statements of this unnamed owner seem to confirm.

Calling Balsillie a "clown," and doing so anonymously, is choice given some of the actions we've seen over the years from NHL ownership, but if this is the general consensus among the governors, there might be a push to make Balsillie's ownership bid a nightmare (and vice versa). If this is the kind of sniping that's going to come out, it could get awfully ugly, and a protracted court battle may be in the cards.

Then again, that's always been the case. These comments merely confirm the fact that there's dissension among the moneyed.

Still, "a pain in the ass" is probably exactly what this group needs, someone who will challenge the status quo. There are other forward-thinking members on the Board of Governors, but they have long been quieted by the old guard, the Bill Wirtzs of the world who have ruled the roost in the NHL since the dawn of time and made the majority of the imbecilic situations regarding continued expansion and the like.

A maverick? Sounds good to me.

It has surprised me, however, just how brazenly Balsillie and his representation have pursued this lease deal in Hamilton despite the fact the purchase agreement has not been approved, and how openly he has addressed the Nashville media with overtures of his harmlessness.

It's not a surprise that this has set off the BoG's warning meter, as playing the Tennessee audience while working to move the club certainly isn't a way for the league to win friends in the U.S.

All that considered, however, Balsillie's likely to succeed in his crusade for the simple reason that he'd be less of "a pain in the ass" if granted his team than if they try to fight this new development. His legal representation is already on a first-name basis with members of the Canadian sports media, which is an indication of the extent to which Mr. BlackBerry intends to go to in order to get his hockey team.

The twists and turns continue, and I'll have to concur with a friend of mine who emailed me this morning: "At this point, absolutely nothing would surprise me about this whole story."

32 Comments:

Southern Ontario is so undeserved for NHL hockey that, if you bring a team, people will come.

I think you meant "underserved," but I in fact agree more with the former statement.

It's not a surprise that this has set off the BoG's warning meter, as playing the Tennessee audience while working to move the club certainly isn't a way for the league to win friends in the U.S.

Which friends in the U.S.? You mean all those hundreds of people who attend hockey games in Nashville? Whatever Preds fans do exist are going to hate him for moving the team. Does it really matter whether he does it nicely or not?

Mark it down -- the Preds will start the 07-08 season in Hamilton. The NHL really has no choice but to green light this sale, as the purchase price improves the value of every franchise in the League. Once the team is sold, I don't the NHL will have any interest in seeing Balsillie putting in a lame-duck year in Nashville, with nightly highlights showing seas of empty seats. From the League's perspective, might as well rip the bandage off all at once, and get the move over with.

How about the good people in K.C. and Las Vegas, those markets the league wants to test drive like they did Nashville? Let's say those cities look at the negatives involved should the team fail there, and they include a Canadian billionaire playing the city and its fans like fools while stripping them of their team.

Mark it down, Dennis - you're nuts. There's no way they could move things that quickly.

As to the point about offending US fans, it's not really about the fans, but rather the political leadership. If the NHL starts allowing teams to break leases, they'll have a much harder time negotiating deals that include public financing in the future. It's not just about Nashville, but that issue affects every team in the league that might want a new rink at some point.

Maybe it is just me but I think the NHL is in dire need of some 'maverick' owners with a passion for the game who will take his team to where it will get real fan support from passionate fans. That is what the NHL needs, not another undersupported team in a non-hockey markey like Las Vegas or Kansas City. In my mind, anyone who ticks off the current NHL regime is all good in my mind because nothing the current NHL regime is doing is any good.

Why would anyone think covering one's bases is clownish? It's business, and there is a possibility that Nashville will remain in Nashville for the next little while. Most franchise owners got the money to buy in somewhere in the private sector where sometimes you have to tell all parties what they want to hear until you're ready to make your move. Why treat hockey fans like children and expect them not to understand this?

I would assume the "clown" comments come from the small market ownership group that dominates Bettman's inner circle.So the league could have a possibly divisive internal batter among the haves and have nots.Does anyone think for a second that Mike Ilitch in Detroit wants to continue to have to jack up ticket prices for his fans in order to fork over tons of money to franchises like Nashville?Remember when Modano broke the record for most goals by a US born player in Nashville and there wasn't any recognition of the achievement? A day or so later Jim Lites the Stars president ripped Nashville basically calling them classless whiners that do nothing but suck money off of the league?George Gillet was also quoted in a recent story bemoaning the revenue sharing part of the CBA and using that as part of the reason for higher ticket prices in Montreal.So I think Balsillie is going to start an internal war between the Haves who are sick and tired of propping up the Have nots.It should be interesting to watch.As well, when his deal is turned down, the Canadian media is going to go absolutely ballistic on Bettman and company.

Baltimore Colts moved overnight, including the offensive line. Preds in Hamilton this fall. Assuming that the Governors swallow their bile and make the correct business decision.

The leaker has a motive, of course. If the Governors really were united against Balsillie, there wouldn't be anonymous leaks. They are torn, hence the leakfest.

KC and Vegas? James, are you serious? I've lived more than a few years in Flyoverland--there is no unexploited market potential for hockey in the States. The whole sports economy was kept afloat by owners holding taxpayers ransom for new facilities. Once that bubble burst, spectacularly in Pittsburgh's case, the artificial economy collapsed. New franchises will have to succeed on their merits as businesses. This means that KC, Vegas, Portland, Spokane, Quad Cities, Birmingham, Lafayette, etc will rot without hockey.

It all comes down to money, and Balsillie is investing double what the Predators are worth in this endeavour. Balsillie is doing really the only thing he can do right now: ensure that if he drops a quarter BILLION dollars on a team, that he will have the right to do what he wishes with it. He is not paying $238 million to stay in a lukewarm market that is losing piles of money.

What interests me is that the other bid for the Preds was also looking to move the team. So, if the NHL turns down Balsillie and his hopes of going to Hamilton, it almost has to turn down Kansas City on the same principle. To do otherwise would almost guarantee a protracted legal fight.

This is a major league powerplay by Balsillie. Leipold has given up on Nashville, and nobody local is interested. The two bidders want the team elsewhere, and the NHL is left with a potential mess in Tennessee if it doesn't approve a sale and move. This will be fun to watch as it unfolds.

So this anonymous BOG doesn't like that Balsillie is already showing himself to be a "pain in the ass" before he's even joined "The Club". Ummmm, hey Wirtz! Why not come out from behind the skirt and pull your head out of your arse? These types of comments have YOU written all over them... Balsillie has already raised the value of your worthless 'Hawks by quite a margin so maybe you should keep a sock in it.

Mavericks? Go for it, but within reason of course. The dinosaur portion of the NHL Board of Governors has stifled every facet of the league from the business side to the on-ice product with their backward thinking. Nobody is advocating going back to glowing pucks or having field goal posts for nets but anytime there is someone who'd like to take baby steps to try and improve the league, this old guard pulls up with their walkers, growls "You forward thinkers get out!" and the status quo is maintained for decades or more... If another franchise is available for sale, get someone like Mark Cuban on it, let's see all the fossil BOG's choke on their Geritol I say...

And once again, by saying that I would put support behind either Balsillie or a BOG like Cuban as fresh blood on the BOG, I am NOT endorsing any chicanery like glow pucks or rounded nets or any other silliness like that, as I'm sure some people out there would probably insinuate since I favour a New Guard over the Old...

Last anonymous and DJ, you are both right, a guy like Balsillie or Cuban would be just what the league needs.

Can anyone else picture Wirtz saying those things? I wonder if he worried that Balsillie might try to get the BoG to pressure him to sell the Hawks so that he can stop ruining a once proud franchise.

I could definitely see the team moving by the start of the '07-'08 year. Not sure that it will happen but it's not really that big of a move. The temporary Copps Coliseum could handle the club until a new arena was built and I don't doubt that tickets sales will do well (at least for the 16 sellouts agaisnt Buffalo, Ottawa, Montreal and Toronto).

I know it's not fair to the Nashville fans that the corporate support isn't there but it wasn't fair to Quebec or Winnepeg either.

One aspect of this issue that seems entirely misguided is the notion that Balsillie is overpaying for the Preds and enhancing the value of all other NHL teams as a result. Franchise values aren't like player contracts, where you can go in front of an arbitrator and argue that X is as good as Y, so X should get paid what Y is.

Franchise sales are complicated endeavors, and having one guy overpay in Nashville doesn't affect what a prospective buyer might offer for some other team.

Oh, and Macndub - when the Baltimore Colts relocated in the middle of the night, their lease had expired.

It is stuff like this that puts me in a really rough place as a Predators season ticket holder.

I would love to have Jim Balsillie be the owner of my club, and i think he will be exactly the maverick the NHL needs in many ways (for reference, see Mark Cuban, owner of the Dallas Mavericks).

However, i don't want him to move the team. The best possible scenario for me is one that i think is not totally unlikely: Balsillie buys the team intending to move them, the fans support the team so the lease doesn't expire, and he stays, since he'd rather own a hockey club in Nashville than none at all.

The NHL needs Balsillie. They need to be shaken up.

But i don't think that retracting the team back to a concentrated area of established support is the best way to fix a broken sport.

"[Hockey] is the only sport that I can think of who’s fans believe that it doesn’t 'belong' in certain places. Could you imagine a die-hard football fan in Chicago saying that football doesn’t belong in Seattle… Maybe a big hoops fan in Philly saying that the NBA shouldn’t be in Phoenix… Perhaps a crazed baseball fan in St. Louis saying that baseball doesn’t belong in Toronto? It truly boggles the mind to think that hockey fans wouldn’t want more hockey fans in more places."

So who is this anonymous Board of Governors member - is it a member of MLSE? Or is it one of the Canadian team members - who will lose a share of national TV money (CBC/TSN) to Balsillie's team?

While I am not advocating that journalists must disclose their sources, I think Mr. Shoalts owes it to his readers to indicate the possible motives of his source (ie. will the source's team be adversley affected by the relocation).

I believe MLSE has started a massive rear guard action against Balsillie. The first indication was the Competition Bureau getting involved. That seemed very strange to me because the last thing Balsillie would want to do at this stage is to "poison the well" with his prospective business partners by threatening them with anti-trust actions in Canada before he has even bought the team.

He may well revert to this once the NHL votes against him - but not at this early stage. Its counter productive as it just serves to anger the NHL Board of Governors.

Now this story comes out along the same lines that Balsillie is "-issing everone off". I smell a rat here.

Back to the Competition Bureau story. To start an investigation someone has to complain to the Commissioner, yet the press never asked the Commissioner who complained - was it in fact Balsillie or his associates. Or was it someone linked to MLSE who wanted to "poison the well" against Balsillie, by getting the Competition Bureau involved.

MLSE knows that it has nothing to fear from the Bureau because the Bureau has always been nothing more than a "toothless tiger" in Canada, and the NHL is legally permitted to determine where its franchises are to be located.

However, if they could get the Bureau to publicly announce this investigation, it would "poison the well" for Balsillie with the NHL BoG.

Now today's story along similar lines. Things are not always as they appear, and when big money is involved, expect to see a lot of deception and mis-direction. Often with the press being used as the messanger.

This is why I think its important that journalists give their readers some indication of the motives of their sources if they don't disclose them.

Also, when the Globe and Mail reports on this story I believe they should be required to put a disclaimer at the end of their reports indicating that CTV Globe Media, which ownes 100% of the Globe and Mail also ownes 15% of MLSE

BNN which is owned 100% by CTV Globe Media always announces such a disclaimer when they discuss the stock or financial affairs of related companies they are reporting on.

Now let me make it perfectly clear James, that I have the highest regard for your independence of reporting, and your comments today show that you in no way are "carrying any water" for MLSE. In fact, it would appear to be just the opposite

However, I do belive columnists and reporters should always disclose the possible motivations of their sources, and any financial conflicts of interest their paper may have, so that the reader is fully informed.

In any event, the media should get its guard up that MLSE is launching a major rear guard action against Balsillie, and they should try to make sure that they are not "being used" by either Balsillie or MLSE.

That's an excellent point about the disclosure practices of business reporting, Frank - this is one of those stories which pulls sportswriters out of their specialty, and can lead to some mistakes or manipulations. Typically those disclosure rules are applied to publicly owned firms (as opposed to private ones in this case), but the point remains the same. The word that's getting out is being distributed by certain parties for certain reasons, and sorting through the spin can be difficult.

It has nothing to do with wanting hockey out of certain geographic areas. I'm a Canadian hockey fan and I want to see more teams in Canada, and if one gets to Hamilton, so much the better for me, i'll actually be able to attend a game (one day).

I don't really care about where teams are located in the US, I just care about how many there are in Canada, and I don't like losing Canadian teams because the NHL has gotten too rich for them. If it comes down to it, I'd rather see the NHL get taken down a notch or two and have NHL hockey be feasible in Winnipeg and Hamilton. And have my own Oilers be secure in their city without relying on the strength of the dollar. Put twenty NHL teams in all in Florida for all I care. Just make sure there are enough in Canada.

Whenever anyone speaks "off the record" to a reporter, they are almost always up to no good, advancing their own agenda. (I'll almost guarantee it was someone from the Leafs -- who else would a Toronto based hockey writer have talked to?) I think it is one of the most spineless moves going. If you have something to say, then have the courage to put your name to it. Otherwise, STFU. Sadly, it is a growing trend in media, as you will see entire articles full of "anonymous sources". I have this old fashioned desire for quotation marks and named sources, but that's just me.

And yes, I know seeing the Preds in Hamilton this Fall seems like a longshot, but I just can't see who benefits from having them put in a lame duck season in Nashville. The bad PR for the league will be horrendous. My bet is that Balsillie will just buy his way out of the lease. It's not like Copps Coliseum is falling apart -- the big ticket renovations can be done next off-season.

I love that people are ready to assume that the story is a plot by MLSE to keep a team out of Hamilton.

Why would they talk to the competition bureau? Because it might poison the well against Balsillie? That is just plain sillie. They already know that in the NHL's eyes they can veto the move. Why would it help them to start an investigation that could end with them losing a veto?

More likely it was Balsillie himself that started the process as he has previously had lawyers provide him with legal advice on whether MLSE's veto is legal. Or maybe it's the NHL that wants their position solidified.

"However, if they could get the Bureau to publicly announce this investigation, it would "poison the well" for Balsillie with the NHL BoG."

There are more than a few other clubs that would benefit from doing the exact same thing but it's always big bad MLSE right?

"they should try to make sure that they are not "being used" by either Balsillie"

Considering the way that Balsillie has played both sides of the fence so far it's far more likely that the investigation is his doing rather than evil MLSE's.

What do they really have to lose? Is a new franchise going to cripple the Leafs? No. Will it make a big impact on their profits? No. Will they even notice the new team? Probably not much.

You know, if/when the Preds do move to Hamilton, they don't even really need to change their sweaters or logo. Hamilton Tigers, Mark II. Done. Switch back to the old orange and black if you'd like, but the framework is essentially already there.

For those who think that this is an MLSE conspiracy, read further in the article

The governor said the three clubs were not in Southern Ontario, a reference to the Toronto Maple Leafs and the Buffalo Sabres.

Of course this guy wouldn't even give his name, so how much can we trust anything he says?

What struck me the most about this entire article was the quote "If you join a club or a fraternity, it is a bunch of people who have to work together in a partnership," the governor said. "Sometimes you have to give up what you want for the greater good of the league."

Since when did the owners of the NHL actually work together "for the greater good"? It sounds good, but if they had worked together, would we have had to experience an entire year without NHL hockey? Only to come up with... oh I can't get started.

What I really don't get is that when Quebec, Winnipeg, and Edmonton were threatened with relocation, it was the "market realities of the NHL", and we all know how quickly Winnipeg and Quebec moved south. Now when someone thinks about moving a team from the United States, even one losing tons of money, every single legal and other roadblock is placed in front of them, first with Pittsburgh and now with Nashville. Something just smells about this.

Sean, that's revisionist history. Quebec City and Winnipeg moved, but it was a drawn-out, angst-ridden process. Edmonton and Calgary were saved. So, yes, there were market realities, but there was also some attention to the brand.

Today, the situation is reversed. The Canadian economy is growing faster than the US's. The loonie is overvalued, for a change. I bet entertainment spending is increasing faster here than in the States, since consumers there are absolutely tapped out. I can talk about treasury yield spreads, but I'm already being boring.

The point is, like many Canadians who have moved back in the past few years, it's starting to make sense for some hockey franchises to start moving here as well. The existing markets can save them or not.

I don't know s***, but how can the NHL force Leopold to continue owning the Predators (and thus continue losing millions of dollars). Thus, logic dictates he must, despite BoG posturing, be able to sell the team to whomever he pleases. Then, once the new guy owns the team, how can he be forced to keep a team in a money-losing city? Now, whether the territorial restrictions hold up in court, that's another thing. But I can't see Ballsillie being held back for long.

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About Me

A sportswriter at The Globe and Mail, James covers the NHL and the game of hockey. He is a member of the Professional Hockey Writers' Association, a radio and TV analyst with TSN and was the NHL network manager at SB Nation from 2008 to 2010. A graduate of Thompson Rivers and Ryerson universities, James grew up in Kamloops, B.C. — one of Canada's great hockey cities — and was a season ticket holder in the Blazers' glory years.

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